Internet-based advertising is now a common means of advertising. There are several basic steps involved:
1. Advertisers bid on keywords. The factors affecting the price of the keywords differ depending on the search engine.
2. Some websites set aside space for ads to be placed. In this advertising model, the website owners cannot choose which ads will fill the space. They have an agreement with search engines to allow search engines to place ads in the allotted space which are closely aligned with the website's content.
3. Advertisers only pay when a web user clicks on the advertisement.
4. Search engines collect this “click-thru” fee and share a portion with the website which hosted the ad.
5. Advertisements placed on websites which are closely related to the ad's subject have higher click-thru rates. Therefore, a high degree of relatedness of the advertisement to the website is advantageous to all parties because:
a. The advertiser gets more targeted exposure;
b. The websites receive payment for bringing traffic to the advertiser;
c. The search engine receives payment for facilitating the arrangement.